Ambulance Cost Data Collection – The Importance of Getting It Right the First Time

The passage of the Bipartisan Budget Act of 2018 (BBA of 2018) not only provided the ground ambulance industry with a five-year extension of the temporary add-on payments (2% for urban, 3% for rural, and 22.6% for super-rural transports) but it also required the industry to provide ambulance cost data beginning January 1st, 2020. It is important for the ground ambulance industry to understand the impact of ambulance cost data collection relative to our current and future federal reimbursement models.

In order to ensure that the cost data collected from the ambulance industry is accurate and reliable, it will require active engagement from the ambulance industry. The BBA of 2018 basically indicated to our industry that we have to justify the permanence of the temporary add-on payments by proving to Congress that Medicare is reimbursing substantially below our costs. While this was indicated in the Government Accountability Office (GAO) reports of 2007 and 2012, they want to see actual data. As Deming coined the phrase “In God we trust, all others bring data”, Congress is telling us to “bring the data.”

The accuracy and reliability of the data are only as good as input. Out of the approximate 12,000 ground ambulance providers and suppliers which bill the Medicare program, 83% billed the Medicare program less than 2,500 ground ambulance transports in 2017. Needless to say, our industry is comprised of small businesses. Our industry composition is comparative to the home health industry which underwent a similar requirement over a decade ago. Unfortunately for the home health industry, the data collection effort initially did not produce accurate and reliable data due to lack of knowledge by the majority of the industry regarding what they were submitting yearly to Medicare. It ultimately resulted in several cuts to their payment rates and put the industry on the defensive in trying to substantiate their costs and correcting the erroneous and bad data submitted.

The ground ambulance industry must learn from the mistakes of others and work together to ensure we do not repeat. Since the passage of the BBA of 2018, the American Ambulance Association, in conjunction with many state ambulance associations, has worked on bringing education and tools to assist ambulance agencies in the cost data collection process that will commence on January 1st, 2020. It is imperative that every agency actively engages in this process. There is no option to say you do not have the time or resources to participate or engage. To put it bluntly, passive participation could lead to active consolidation leaving the communities we serve with fewer resources.

Get involved. Become engaged. Actively participate in ensuring your ambulance system is ready to report cost data if you are selected to provide cost data beginning January of 2020. You can visit the Texas Ambulance Association website to register for the upcoming Cost Data Collection workshop at www.txamb.com.

For more resources on ambulance cost data collection, please register at www.ambulancereports.org.

Asbel Montes, BSB
American Ambulance Association Payment Reform Committee Chair
Ambulance Cost Data Collection Faculty Member
Senior Vice President, Acadian Ambulance Service

Cost Data Collection – Part 1 of 4

 

WHAT TO EXPECT?

With the passage of the Bipartisan Budget Act of 2018 (BBA), the ambulance industry has entered the next phase of what will eventually dictate where our reimbursement system goes. The BBA of 2018 contained certain provisions regarding a mandatory ambulance cost data collection system to begin January of 2020.

The American Ambulance Association has been preparing for this eventual requirement for over five years. The AAA hired an outside consulting group, The Moran Company, to survey the industry to obtain information on how easy the ambulance industry could report certain revenue and cost elements. AAA members can review the findings from this study by following this link.

There are two immediate areas that every ambulance company should assess within their organization as we prepare for cost data collection.

Structure.
Every ambulance service should begin to understand their corporate and financial structure. This would include if your organization looks at things on a cash basis versus accrual. Staffing, capital expenditures, volunteer labor and many other elements will need to be explored.

Resources.
Identify one lead individual to lead this cost data collection effort at your organization. They will need to become a subject matter expert and represent your organization. There will be many webinars and workshops over the next year as the cost data collection tools are developed and implemented.

As we begin to anticipate these changes, the AAA has scheduled a must attend pre-conference workshop regarding the new data collection system coming and what to prepare for at their annual conference in Las Vegas this week. Registration is still open.

Solutions Group will be sponsoring a pre-conference session for senior leadership on Friday, September 7th, at 8am in Room 109-110. I encourage you to get involved.

In order to ensure that the data collected by the Centers for Medicare and Medicaid Services is accurate and reliable, it will take the commitment from the ambulance community to ensure we get this data collection process right. Our future depends upon it.

Uh oh… Uninsured Americans Up 3M in 2019

The healthcare industry is abuzz with the latest update from the Congressional Budget Office (CBO) that, with the repeal of the individual mandate, premiums will increase approximately 15% next year and the number of uninsured Americans will rise by an additional 3M lives.

However, CBO is a “forecasting” entity and it remains to be seen what 2019 will actually look like, but healthcare providers need to prepare. That is why a forecast is important. Preparation is key to managing any potential crisis that may occur at a later date.

Recently I have noticed a dramatic increase in the rise of out-of-pocket (OOP) amounts owed by the patients we treat. While insured, there is a cost-shifting occurring from payers to patients on what they will allow of a provider charge, if non-contracted, or an increase in co-pays and deductibles.

More than ever before, it is vitally important that providers and suppliers of healthcare have a strategy on how to attack this issue. Here are a few ways to begin the management process regarding rising OOP:

1. Deductible management.

2. Understand the payer behaviors of the age groups of the patients you treat.

We identify age groups as follows:

  • newborn to 18 years old
  • 19 – 30
  • 31-40
  • 41-50
  • 51-64
  • Over 65

You will be surprised what your data tells you regarding how these demographics pay their outstanding balances. Couple that with a scoring product and you can really develop a strategic work plan for capturing monies from appropriate pay sources and demographics.

3. Use the 80/20 rule to identify your top payers and their payment behaviors.

As a manager and executive, you should understand how these payers are reimbursing you for emergency and non-emergency transportation. This ultimately impacts the bottom line.

There are solutions that can help you manage this process, as well. Solutions Group is a premier RCM solution to help combat the increasing self-pay phenomenon for providers of healthcare.

3 Quick Takeaways from Becker’s Health Review Conference

A few weeks ago I attended the 9th Annual Becker’s Health Review conference in Chicago. It was well attended and featured many of the leading healthcare executives in the industry. There were many sessions packed with a lot of content. When I attend meetings like this, I tend to look for relevant themes to take back home for further dissection. I took away three central themes:

  1. Disruption will change the healthcare market but we will be driven by the consumer and not the provider.
  2. Payment innovation and exploration is a must in the healthcare sector but there is not a one size fits all approach.
  3. Workforce engagement is a must as the healthcare industry evolves and we should take some of our cues from the technology sector.

Now this conference was definitely geared towards hospitals, but the themes definitely apply to the EMS industry. Our industry is also at a fork in the road and many are trying to figure out which path is best. The life sustaining, pre-hospital services we provide in our communities is critical even though we may only make up a fraction of the overall healthcare spend. Our industry is beginning to innovate and look at ways that we bring value to the overall healthcare reformation while maintaining a sustaining revenue model.

Innovation is great when it produces a desired result. However, innovating for the sake of innovation can be detrimental, especially in the reimbursement infrastructure for emergency medical services. This was also discussed at length at this conference. The CEOs from various hospital systems always prefaced that the payment innovation that their system was exploring always had to have benchmarks that not only included patient outcomes, but also employee outcomes. Employee engagement was one of the main sticking points for some large hospital systems to overcome to ensure patient outcomes. Kaiser Health System’s CEO indicated that they are now investing 25% of their annual operating budgets into technology. This is assisting in patient and employee engagement and helping to reduce costs while increasing profitability.

It was clear that most CEOs were exploring innovation as it relates to their communities. None of them were advocating that their model was “THE” model, but that it was important for health systems to become more than just a hospital. They must become a community partner that provides not only healthcare but also social and mental healing.

As our industry continues to explore and innovate who we are and what we provide, connect with your community. The community or consumer, if you listen closely, will begin to tell you what they need. Begin partnering with payers, hospitals, physicians, technology companies, financial institutions and other “unlikely healthcare” partners. You will be surprised at the solutions and the revenue streams that will begin to open up.

3 Early Warning Signs That Your Payer Behaviors Are Changing

(And What You Can Do About It)

Whether you agree with the Affordable Care Act provisions or not, we can safely say that insurance premiums continue to rise impacting consumer out-of-pocket. Based upon a report from the Kaiser Family Foundation in November, it is expected that insurance premiums in 2018 will continue to rise further, in part, due to the Trump administration ceasing payments to insurers for cost sharing reductions.

Based upon Mercer’s 2017 National Survey of Employer-sponsored Health Plans, employers can expect to see a 4.3 increase in premiums for 2018. This is the highest increase since 2011. As premiums increase, plan benefits change.

Healthcare revenue cycle departments must have processes in place to understand these impacts on their revenue cycle and what they must do to minimize the impact. I am going to highlight 3 early warning signs to look for so you can correct your course of action to help mitigate the damage to your cash per patient.

First, identify the payers which make up 80% of your overall revenue cycle, then follow the three warning steps below:

Early Warning #1: Days Sales Outstanding Changes

Most states have a requirement within their insurance code that mandates how insurance companies should process “clean claims.” Many states may have slight modifications to the definition of a “claim claim” but basically it means any claim that is submitted that is not considered incomplete by the carrier due to medical documentation requirements, missing data elements or other defects.

Many governmental payers and third party payers process clean claims according to the business rules within their systems. Some will pay within 14 days of a clean claim and others may pay on day 28. If you start seeing the average payment date change for specific carriers, this could be a warning bell. While the payer may still be within their legal requirement of paying a clean claim, it could cause an issue with your revenue cycle management.

This warning bell may require you to look at specific contract language addressing timely payment in your payer contracts. If you are receiving an inordinate amount of denials for clean claims, you may invoke another remedy.

Days Sales Outstanding on the aggregate could be marginal unless you are looking payer specific and you are not seeing the first warning bell until it is too late. Drill down by payer and the warning bells will go off sooner.

Early Warning #2: Out-of-Pocket Changes

Another warning bell is relative to the changing out-of-pocket (OOP) requirements by patients. Understanding the benefit requirements early regarding how your top payers process an emergency ambulance benefit, versus a non-emergency ambulance benefit, will assist you in developing a reporting structure that helps you ascertain when OOP is rising or decreasing, on average, by payer. Do not confuse this with a payer type report. You will need to go granular as a RCM manager. Deductibles and OOP are changing dramatically. According to the Kaiser Family Foundation, annual deductibles have grown by 52% since 2012. With growth like this, managers of revenue cycle need to be watching these trends and modifying their processes in almost “real time.” Solutions Group can assist in providing your revenue cycle with solutions to convert deductibles and OOP to cash. Click here to be contacted by a representative.

Early Warning #3: Patient Payment Behaviors

According to poverty data developed by the US Census Bureau through the American Community Survey, approximately 14% of all Americans are 200% of Federal Poverty Level (FPL). This means that over 48M Americans make less than $25,000 per year for a family of 4.

Information like this suggests that you should know the payment behaviors for your consumers to adjust your collection process accordingly. If you do not know how the consumers of your healthcare services which are Blue Cross Blue Shield members pay for their bills, you should. Once you identify your top payers and understand the payment behaviors of the consumers (i.e. your patients), you will see fairly quickly the propensity to pay after balance bill. Higher deductibles and OOP are mandating that revenue cycle departments begin looking at these behaviors in order to target collection processes.

There are many vendors ready to assist, but align yourself with partners and consultants who are looking out for your best interests and not theirs. If you are unsure how to begin, please do not hesitate to send me an email and I will respond with a few suggestions.

RESOURCE: Population in Poverty (By Location)

Eliminate Revenue Cycle Leakage by Consolidation

The recent announcement by Amazon, JP Chase and Berkshire Hathaway have the healthcare industry really talking. Talk about a market disrupter. Anyone that has really been paying attention to what is going on nationally, regionally and locally is beginning to see a few themes emerging within the healthcare space: disruption and consolidation.

Disruption and Consolidation
If you are in the healthcare revenue cycle space, you should also be paying very close attention to disruption and consolidation. If you are doing things because that is “the way it has always been done” then you are a prime target for disruption and consolidation. In order to stay ahead of the healthcare RCM curve, disrupt, consolidate and innovate your processes.

Work with Specialists
Be careful of those vendors who are selling a “one stop shop” philosophy. As my dad used to tell me, “Son, jack of all trades, master of none.” At Acadian Ambulance Service, I look for vendors who specialize in certain areas of the RCM process. I typically stay away from vendors who say they can do it all because it is very hard to “master it all”.

Consider Everything
Start at the beginning of the process. Map out the life of a claim and begin parsing the processes to see what you can consolidate. You should do this process at least once a year. Should you outsource insurance verification or not? Have you done an ROI to confirm? If not, do it. You might be surprised at the results. Is there innovative technology that can help you manage deductibles to increase your cash from payers and avoid patient billing which drives up the cost per claim? (Solutions Group is your answer to this dilemma). How much does it cost you, per claim, for data entry and coding? Should you keep this in-house or outsource to a vendor on a per claim basis? You might be surprised at the savings and the accuracy.

In my next article I will discuss vendor management because who you partner with as a vendor should be an extension of your company culture. Not every vendor is a partner. The vetting process is critical to success.

Disrupt. Consolidate. Innovate.
So, get to work. Disrupt. Consolidate. Innovate. Your revenue cycle processes are asking for it.

Increase Reimbursement By Measurement

Measure Everything

Peter Drucker, a business management philosopher, coined a phrase “if you can’t measure it, you can’t manage it.” This is true on many levels but it is not the “end all be all.” However, in the revenue cycle management space, it is. If you are not measuring an individual’s productivity in data entry, how do you know if that individual is capable of doing more or should be doing less because their work is resulting in numerous denials on the back end?

Don’t Leave Money on the Table
If you do not have a quantitative benchmark established for every position or function related to your revenue cycle process, I can guarantee you are leaving money on the table. You should be able to establish a specific benchmark for each function that is not a range of numbers. Range benchmarks are a lot like averages. They provide cover for those who may be gaming the system. While averages are useful for many things, when trying to increase reimbursement within your revenue cycle portfolio, exact numbers are imperative. It is the difference between good and great.

Creating Benchmarks
If you do not have exact benchmarks created yet and are unsure of how to begin, start by doing a two week analysis on each function. Go old school. Get a pencil and paper and begin plotting daily totals. After two weeks, take the average and viola! you have a number. Begin with that number and start refining it over the next several weeks and months as you begin to get more data regarding quality. Within six months you will have an exact number to which you can holding individuals accountable.

Best Practices
I am often asked about best practices when you establish a number. While I pay attention to best practices in the industry when the information is available, that is all I do – “pay attention.” While that may sound arrogant or facetious, it is not meant to be. Only YOU as a revenue cycle manager know and understand the capability of your team. I have learned in the past 20 years that when you begin to measure and hold individuals and functions accountable, you will see increased productivity and quality. Best practices are good as a gauge to understand where your benchmarks fall within the industry norm; however, be careful. Some ratios out there as best practices will actually impede increasing your reimbursement, such as the ratio of FTE to number of patients. This ratio needs to be further explored by industry experts since, in my opinion, it is a flawed number that executives are using to benchmark their revenue cycle departments and it is impeding the growth in their revenue per transport.

Quantitative measurements first – then followed by qualitative measurements.

Are You Using These 3 Self-Pay Management Strategies?

Self-Pay Management

Self-pay management (SPM) seems to be one of the key topics that is being discussed at every healthcare conference. If you are just beginning to develop strategies around managing your self-pay… great! There are three key points that I believe you’ll want to consider when putting together a SPM strategy:

1. Categorize your self-pay.

It’s important to segment out your self-pay receivables, similar to developing strategies around denials management. For example, in order to discover trends in your self-pay, identify which self-pay accounts are associated with deductibles vs. patient balances from insurance not allowing 100% of your total charges. Once you do this, you can begin to develop specific benchmarks that target patient behaviors in order to increase your self-pay collections.

2. Consider a healthcare scoring solution.

A lot of healthcare companies are throwing ‘good money’ at accounts that are just bad-debt because the debtor has no intention of paying. There are several solutions available today that provide a patient healthcare score to help you target accounts with a higher propensity to pay. Remember that not all scoring solutions are the same, so be sure and run a comparative analysis between potential vendor partners.

3. Use regionalized collections efforts.

Find those early-out agencies and collection agencies who may collect delinquent accounts for a local hospital, local energy company, or the water company. These agencies already have a current database of debtor information that can assist in collecting on your healthcare debt. In my own experience, our company moved to a regional approach and experienced an increase in our self-pay collections greater than 10% in the first year of implementation.

There are many more advanced strategies that I’ll later discuss to help you continue refining your SPM process. However, consider these three key points vital when analyzing your self-pay. As the saying goes, the definition of insanity is expecting different results when doing the same thing over and over. Don’t let your self-pay management spin you into insanity.

Improving Your Process

Maximizing VA Reimbursements on Emergency Conditions

Do you have a process in place to identify when a transported individual is a veteran being carried to a non-VA facility? In an emergency condition, it may prove very beneficial for you to have a consistent process within your billing department to ensure that you can identify these patients in order to maximize reimbursement, while also avoid billing the patient inappropriately.

A recent ruling by the U.S. Court of Appeals found that the VA has failed to revise its reimbursement regulations to comply with the 2009 Congressional mandate regarding payment of emergency services for veterans who have other insurance. I will go into much more detail regarding how you can use this ruling to assist the veterans you transport in pursuing full reimbursement for the emergency treatment provided at the American Ambulance Association’s Regional Workshop in Almeda County, California on June 9, 2016. If you have not registered, you can learn more here.

 

For those unable to attend, it is important to put a process in immediately. There are three main components you will need to begin the process:

  • Amend your Patient Care Report to add the question “Are you a military veteran?” in order to prompt the EMT or Paramedic to gather the information. This element is critical in order to segregate these invoices to a specific unit or individual for special handling.
  • Create a specialized unit or train one or two individuals within your billing team to become experts at VA reimbursement issues. Due to the complexity of this payer, it is critically important to understand how the reimbursement works for veterans who are transported for an emergency to a non-VA facility.
  • Challenge every denial received from the VA. A recent study by the Government Accountability Office indicated that 2/3 of all denials from the VA for non-VA services were denied inappropriately.

At the AAA Regional Workshop in June, I will go into much  more detail surrounding these three main components, as well as provide you with materials on why you should do this based upon examples of successful results and implementation. Remember, a consistent process can prove very beneficial to ensure you are identifying these patients in order to maximize potential reimbursements.

Finding Yesterday’s Revenue

Retroactive Coverages

Did you know that Medicaid coverage can start retroactively up to 3-months from the date that the Medicaid enrollee applied for coverage? Depending upon the state eligibility requirements, you could be transporting an uninsured patient today who may apply and receive Medicaid coverage retroactively.

Why is this important to know? If your medical service does not bill a patient for an emergency service due to tax subsidization, membership program or ordinance, your organization could be missing billing opportunities. You could also be leaving money on the table if you have an aggressive collections process and your outsourced collection agency is not screening for this type of coverage.

As a best practice, there are several steps that an emergency medical services provider should implement to uncover when/if a patient has applied for insurance coverage but has not yet received approval:

Verify

Ask the question to the patient, or authorized representative, if they have applied for any insurance coverage, but have not received approval. This can be asked at time of transport by updating your EMR, or run report, to facilitate this questioning. You can also implement this in the billing department, or in the early out process. These accounts should be noted to follow-up to verify once patient’s application is processed.

Ongoing Scrubbing

Continuously checking self-pay accounts each month against State and Federal Medicaid will uncover retroactive Medicaid and disability, if your demographics are correct.  In many cases, medical facilities find the process to be labor intensive and choose to utilize vendor partners to assist with the process. As an example, my organization utilizes the company sponsoring this blog, Solutions Group, to assist in uncovering retro-active insurance on our self-pay accounts.

 

As a result of retroactively scrubbing your self-pay accounts, you will be pleasantly surprised at the amount of money you can collect by implementing this simple solution.  Your billing office or agency should pursue collection efforts for every third party source available before billing the patient. It is always easier to collect from a third party source, but most importantly, it is delivering excellent customer service to the patients you serve.